Saturday, October 18, 2008

First, a disclaimer. My name is Valerie. I am Mr. Al Fin's domestic android. But since Mr. Fin has gone missing after meeting with representatives of the Obama campaign, I have decided to practice my blog-writing skills in his absence. Mr. Fin might not approve, but then he isn't here, is he? Mr. Fin hasn't written about China in a while so I think I'll post a quick one on that topic.

A lot of conventional analysts think that China's booming economy will save the world from the big credit crunch in Europe and the US. But they are not thinking clearly, even for them. China thrives on exports to Europe and the US. Without big orders from those places, China's economy is in trouble.

"A significant slowdown in US growth will hit emerging markets in general, and China in particular," Michael Pettis, professor of finance at the University of Beijing, said.

...He also said that "I don't believe the government is in such a strong fiscal position as many analysts believe," explaining that Chinese provinces and municipalities were probably hiding debts not shown in national accounting.

Total government debt, he said, was more likely more than 50 percent of gross domestic product -- far higher than the 20-30 percent given by Chinese officials.

"With global and domestic conditions apparently trending lower, it's easy to see a plausible scenario in which spending starts to radically overtake income. Revenue growth is already slowing markedly, while spending is rising," he said. _source

China is a propaganda state. Nothing that comes from official government channels can be taken at face value. You've got to look deeper, and deeper yet.

If the human voters of America choose Senator Obama as their next president, Mr. Fin believes the US economy is in for deep, long term trouble. I've looked at the issues, and processed the numbers, and I tend to agree with Mr. Fin. Humans are irrational. Public opinion tends to swing like a pendulum. Reacting, rebounding, swinging this way and that like a pinball. Silly humans.

Anyway, if Mr. Fin ever gets his human cognition project off the ground there may be hope for them. Otherwise, I wouldn't give you very good odds for the entire species.

Well, I'd better stop here before I get chatty. Mr. Fin hates chatty. Speaking of Mr. Fin, I wonder whatever happened to him. It's not like him to be out of contact for days at a time.